Justice Dept. Plans to Recommend Easing Restrictions on Marijuana

The Justice Department plans to recommend easing restrictions on marijuana in what could amount to a major change in federal policy, according to people familiar with the matter.

Even though the move, which kicks off a lengthy rule-making process, does not end the criminalization of the drug, it would be a significant shift in how the government views the safety and use of marijuana for medical purposes.

The decision reflects the Biden administration’s effort to liberalize marijuana policy in a way that puts it more in line with the public as increasingly more Americans favor legalizing the drug. It also comes at an opportune time for President Biden, who is trailing the presumptive Republican nominee, former President Donald J. Trump, entering November’s election, according to a recent CNN poll.

It could also lead to the softening of other laws and regulations that account for the use or possession of cannabis, including sentencing guidelines, banking and access to public housing.

One person familiar with the recommendation, speaking on the condition of anonymity, said Attorney General Merrick B. Garland would tell the White House Office of Management and Budget on Tuesday that the government should change the drug’s classification.

For more than half a century, marijuana has been considered a Schedule I drug, classified on the same level as highly addictive substances like heroin that the Drug Enforcement Administration describes as having no currently accepted medical use. Moving marijuana to Schedule III, as the Department of Health and Human Services has recommended, would put it alongside less addictive substances like Tylenol with codeine, ketamine and testosterone, meaning that it would be subject to fewer restrictions on production and research, and that it could be prescribed by a doctor.

The decision to recommend changing the status of marijuana came despite concerns by Anne Milgram, the administrator of the Drug Enforcement Administration, which has long relied on federal research and data to support these decisions, according to a law enforcement official familiar with the matter.

White House officials have privately acknowledged the political benefit of easing marijuana restrictions: It could energize younger voters dissatisfied with the White House and please criminal justice advocates who have pressed Mr. Biden to overhaul the nation’s drug policy.

While Mr. Biden has been slow to embrace such a change, he has for years said that designating marijuana on the same level as heroin or LSD made little sense. He hinted that change could soon be coming during his State of the Union address in March; about a week later, Vice President Kamala Harris said that the D.E.A. must reassess marijuana “as quickly as possible.”

The Associated Press earlier reported the Justice Department decision.

Support for easing marijuana restrictions has grown over the years, shifting from a point of focus among the left flank of the Democratic Party to becoming a more bipartisan issue. A Gallup poll from last November found that 70 percent of Americans thought marijuana use should be legal, an increase from 50 percent in 2013.

Still, the change will do little to alter the current landscape, with the most immediate impact on the cannabis industry itself.

“A lot of people are going to be disappointed and probably a bit surprised about how very little changes,” said Paul Armentano, deputy director of the advocacy group NORML, the National Organization for the Reform of Marijuana Laws.

Already, 38 states, the District of Columbia and three territories have approved its use for medical reasons. Many of those places have also approved it for recreational use.

But the D.E.A.’s move does not make state laws on using medical marijuana compliant with the federal law.

And for states that have not approved the use of marijuana for medicinal or recreational purposes, downgrading the drug would not automatically change state and local criminal statutes.

The bigger shift, many say, is cultural.

“It is a strong signal that the war on drugs and the crimes that are associated with the war on drugs should continue to be re-evaluated and should continue to be reformed and change,” said Ed Chung, the vice president of initiatives at the nonprofit Vera Institute of Justice, which focuses on criminal justice reform. “There is a huge messaging aspect to that.”

The cannabis industry stands to benefit the most from the recommended change, which would ensure that state-licensed businesses are eligible for a steep tax cut, possibly leading to lower prices for consumers.

This tax relief is estimated to free up millions of dollars for companies to put toward things like hiring, expansion and product development, all of which could be a boon to local economies.

Under tax law, businesses related to controlled substances that are classified in the top two tiers are deemed ineligible for most credits or reductions.

Categorizing marijuana as a Schedule III drug removes such restrictions, allowing plant-touching businesses like cultivators, processors and retailers to claim common deductions for expenses like rent, payroll and marketing.

It is not yet clear how rescheduling will affect businesses’ access to financial services, or the lack thereof. Currently, many cannabis businesses are forced to operate in cash only, because most banks do not want to risk handling cash made from selling an illegal substance under federal law. Doing so is considered money laundering.

The federal government last looked at rescheduling marijuana at the end of the Obama administration. Ultimately, the D.E.A. denied a petition to change marijuana’s classification, based on a recommendation from the Department of Health and Human Services. At the time, officials cited federal health experts’ assessments that “marijuana has a high potential for abuse, has no accepted medical use in the United States and lacks an acceptable level of safety for use even under medical supervision.”

But in the past decade, more states have moved to decriminalize small amounts of marijuana and make it available for medical use, and the industry has pressured the federal government to revisit that 2016 decision.

Ashley Southall and Andrew Jacobs contributed reporting.